Dr.Hong on Land Readjustment

World Bank Interviewed Dr. Hong on the concept and implementation of "Land Readjustment". STL Lab will produce our first MOOC on this subject. 



What is land readjustment?

Land readjustment is actually a very simple idea.This approach encourages land owners to pool their land together for comprehensive redevelopment.  When land puzzles are assembled into a single large site, it is much easier to do comprehensive redevelopment.  That will allow the planners to make space for public use, such as a park or other public facilities.  Most importantly, through land readjustment, land space can be reserved for sale, and the revenue can be used to cover the costs of infrastructural development.  Land readjustment is actually a win-win approach. For the government, because of the voluntary pulling of land, or land sites, the government will not have to use compulsory purchase or imminent domain to acquire land.  That method has proven socially, politically, and economically costly.  For the communities, of course, when land readjustment upgrades the entire neighborhood by putting in public infrastructures, the whole neighborhood improves.  So instead of leaving, the residents will increase.  For the landowners, it’s also a win, because as the land is being better served, the land value increases.  Thereby, the net value of the real assets will also rise.  For the developers, this is also a good thing, because now they are able to get land for profit-making operations.  For most developers, getting land for development, or developable land, is the most difficult part of the entire operation.

Why is land readjustment relevant in solving rapid urbanization problems in developing countries?

First and foremost, it’s finance.  The acquisition costs, in most cases, are very high.  By swapping land, instead of acquiring land forcefully, costs can often be totally reduced. Second, land readjustment is a mechanism through which the communities can be sort of trained to be involved in public policy decisions in a way that will be more open and inclusive.  This approach will be beneficial, not only from a technical viewpoint, but also from an institutional and governance-building viewpoint.

How to help pilot and scale up land readjustment in developing countries?

Developing countries normally depend on experts, from the World Bank, UN-Habitat, or other academic institutions to help them with the projects.  The local, indigenous experts are not building their own capacity enough to sustain this kind of operation without these systems from the outside.  So my argument is that we look at land readjustment from a governance building perspective. On top of knowing all the techniques—how to assemble land, calculate land value before and after land readjustment—we also have to focus on how to engage different stakeholders in a very open and inclusive way.  That way, they feel a sense of ownership of the project, and they will be eager to learn all the details and techniques, and come up with an indigenous path that fits their own context; to perfect the method in a way that can carry on to assemble land, to rebuild old neighborhoods, or convert rural land into urban use.  So again, one more time, I think a more governance-centered approach of land readjustment. I would think, personally, that this would be the best way to push the agenda forward into the future.

What is the biggest challenge for developing countries to adopt this governance-centered land readjustment approach?

Land readjustment requires a high level of coordination and cooperation.  I must admit that we do not do that very well, especially when we talk about our own assets. But land readjustment requires people to do that in order to be successful. So that is the biggest challenge: how can we change people’s mindsets from a self-centered approach into a more community-centered approach?  Land value can only be created collectively.

How can successful cases from other countries help with land readjustment process locally?

Showing actual cases that have been successful in doing land readjustment lay the groundwork, or provide the different elements, for this kind of approach.  In seeing the various options for land readjustment, a country can pick-and-choose the best parts for them. Ultimately, they can assemble the pieces together according to their own context and make it workable in their own countries.  And I think the approach of accumulating more and more successful stories and cases is a very important step towards propagating—or scaling-up—land readjustment at the global level.